Melbourne Victory managing director Caroline Carnegie wants to “tidy up” the status of 777 Partners’ minority stake as soon as possible as the club seeks to turn around its troubling financial situation.
777 Partners purchased a minority 19.9% stake in Victory in October 2022, a deal then-chair Antony Di Pietro said would “strengthen [Victory’s] capital base and will allow the club to supercharge its growth trajectory.” However, the Miami-based group’s investment spree in clubs around the world soon gave way to crises and accusations of fraud and it collapsed earlier this year, with its creditors A-Cap – who have become embroiled in troubles of their own – taking control of its football portfolio.
Victory’s agreement with 777 included provisos it could secure up to 70% of the club in exchange for investments totalling up to AU $30 million and that if it opted to depart, it would be refunded any investment made beyond its initial stake at a compounding interest of 10%. But while their collapse prevented them from exercising this option and Victory quickly replaced 777-owned Bonza Airlines as a front-of-shirt sponsor following the budget carrier’s collapse, the entity holding the 19.9% stake retains a minority share.
“At the moment, the entity that holds the shares here is not insolvent, so 777 Partners is still a shareholder at this point, which has a right to appoint a director,” Carnegie told ESPN. “Clearly, without speaking out of school, there’s some conflict-related issues where they can’t be involved in what’s happening day-to-day with the club. Some issues they can, some issues they can’t. There’s been a very light touch approach for a very long period.
“It’s something we’d like to tidy up sooner rather than later. From a fan perspective… there’s no influence over what we’re doing at Victory at the moment that anybody should be concerned about.
“What we do want to do is make sure that we’re successful going into the future, which means we’ve got the right partners in the right places who can help us, not just from a capital perspective, but from a pathway perspective.”
Against a backdrop of Patrick Kisnorbo’s shock walkout days before the Christmas Derby, Victory held its AMG on Thursday evening, where John Dovaston was re-elected as chair. It came weeks after the club released results for the 2023-24 financial year revealing losses of AU$9.87 million and noting “a material uncertainty exists that may cast significant doubt on [Victory’s] ability to continue as a going concern,” should plans to increase cash reserves or secure additional capital “not materialise”.
Club backers have provided $AU 3.4 million in funding since those accounts were lodged and payment plans on outstanding debts have been agreed with both creditors and tax authorities. Backroom operations have also undergone downsizing, resulting in redundancies and staff departures.
“It’s a difficult economic climate, it’s a difficult position football is in,” Carnegie said. “It’s lovely to see more [media] turn up [to interim Arthur Diles’ first appearance following Kisnorbo’s exit], it would be nice if they turned up every day to support our code.
“We made some decisions last year with a strategic partner who should have been able to support those decisions, who ultimately wasn’t able to support those decisions. That had a big impact on what we were doing. The ongoing impact of [2022’s Christmas Derby pitch invasion] had a significant impact on our financials last year; we had thousands of people opt out of memberships [and] impact then happened last season. We’re now getting back to — in a difficult economic climate — a more normalized environment for us.
“Where we sat at the end of FY 24, internally, people have been very clear on where that is and what needs to happen to start to change that. We’ve spoken for the last few years about a five-year plan to get us back to where we need to be. Absolutely it went the wrong direction last year. But we will still get back onto that plan and turn things around.”
Both Carnegie and Victory’s head of football John Didulica were adamant that there was “no connection” between the club’s financial position and Kisnorbo’s abrupt departure and denied the club would be forced to sell talent in the January transfer window rather than weigh offers on their own merits. Carnegie also said Didulica hadn’t received directions barring him from signing players.
Didluca, though, was brusque in declaring that Victory had an “amazing squad, the best squad in the country” and that “we don’t need to bring players in.”
“We’re happy with the squad, why would we bring someone else in?” he said. “We made a Cup final. We’re playing unbelievable football, five wins out of seven. Who do you want to bring in? Who should we bring in?”
